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In this article Chris Hadrill, a specialist employment solicitor at Redmans, explores what settlement agreements are and gives some tips on what you should do if you have been offered one

What are settlement agreements? A quick guide

An employee has the right to bring certain claims against their employer, whether such claims can be brought under statute (for example, unfair dismissal or discrimination claims), contract (for example, a failure to pay a bonus), or tort (for example, negligence claims). Such claims may arise on the employee’s recruitment, during the course of their employment, or upon termination. In certain circumstances an employer may wish to agree to provide the employee with benefits (e.g. a payment of compensation, a reference, sometimes an apology) in return for the employee’s agreement that they will waive their right to bring such claims, or withdraw them if they have already issued a claim. This may happen where employment is continuing, but it is most common for the parties to do so where employment has terminated (or is about to do so).

Employees can only agree to settle or waive most statutory claims by one of the following means:

  • If an agreement is reached through ACAS (and recorded in a COT3 agreement); or
  • If such agreement is recorded in a settlement agreement that complies with various statutory requirements (for example, the agreement must be in writing and the employee must receive independent legal advice on the terms and effect of the agreement)

Only certain statutory claims may be settled by a settlement agreement including, among others:

  • Claims for unfair dismissal;
  • Claims for a statutory redundancy payment;
  • Claims for discrimination, harassment, victimisation or detriment;
  • Claims for detriment or dismissal because the employee has ‘blown the whistle’;
  • Claims in relation to the national minimum wage;
  • Claims in relation to unlawful deduction of wages

Until July 2013 statutory agreements of this nature were renamed from “compromise agreements” to “settlement agreements”, although it is not clear why this change was made.

What should you do if you have been offered a settlement agreement?

If you’ve been offered a settlement agreement by your employer then one of the first things that you should normally do is fine a suitable specialist employment solicitor to advise you on your agreement: your employer will normally cover an agreed level of legal fees for the advice and you must receive legal advice from an independent legal adviser on the terms and effect of the agreement for the settlement agreement to be binding. However, it is up to you to choose how much or how little work you want your solicitor to do: most employees will, in my experience, want their solicitor to handle the negotiations on the agreement as well as the advice, but in some circumstances the employee may be best-placed to negotiate the terms of the agreement themselves (for example if they have a good existing relationship with senior management handling the negotiations or if they wish to keep the costs of the negotiation as low as possible).

Why should you choose Redmans to advise you on your settlement agreement?

Redmans have advised thousands of clients on their settlement agreements, and our specialist employment solicitors have dealt with agreements worth £1,000 to settlement agreements worth over £1 million.

If you want to discuss your settlement agreement further please contact our enquiries team by telephone on 020 3397 3601 or email Redmans using the following email address: enquiries@redmans.co.uk.

About Chris Hadrill

Chris is a specialist employment lawyer at Redmans. He specialises in contentious and non-contentious employment matters, including breach of contract claims, compromise agreements and Employment Tribunal cases. He writes on employment law matters on a variety of websites, including Direct 2 Lawyers, Lawontheweb.co.uk, LegalVoice, the Justice Gap and his own blog. Contact Chris by emailing him at chadrill@redmans.co.uk

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Testimonials

4.78 Average

143 Reviews

Liz P

An excellent professional service was provided by Chris Hadrill and Mel Chin. Efficient and trustworthy - would highly recommend this company.

Posted 2 weeks ago

Anonymous

Redmans Solicitors were great. They were able to advice me quickly and efficiently! I would recommend them, as a good solicitors to use.

Posted 2 weeks ago

Anonymous

Extremely efficient. Mel made a difficult situation bearable and gave good clear guidance thoughout.

Posted 3 weeks ago

Anonymous

Thanks Chris and Sacha I was reassured throughout the process and a happy outcome

Posted 3 weeks ago

Edward F

Good and clear employment advice

Posted 3 weeks ago

Richard O

Chris at Redmans is my go-to legal expert when it comes to employee-related matters. His depth of knowledge, experience and considered approach to problems and their solutions is highly valuable. I cannot recommend Redmans highly enough.

Posted 1 month ago

Rory Y

They provide me with timely and clear advice!

Posted 1 month ago

Steven C

Redmans handled my settlement with my employer quickly, decisively and to a standard that I was very happy with. I would in similar circumstances contract them again

Posted 1 month ago

Deepthi K

Transparent. Clear communication. Prompt reply’s. Saves lot of time. Very satisfied.

Posted 1 month ago

Anonymous

Chris and Sacha did a fantastic job and negotiated a significant better settlement agreement

Posted 1 month ago

Dino D

I did get a very swift and god service from Redmans

Posted 1 month ago

Stephanie H

Clear, prompt, effective support from Chris which has been very much appreciated. Thank you again.

Posted 1 month ago

Anonymous

I would highly recommend Redmans Solicitors, the team were very friendly and my case was dealt with professionally and efficiently. Thank you!

Posted 2 months ago

Shane M

Very professional, welcome advice at a crucial time. Always available and reasonable cost.

Posted 2 months ago

Anonymous

My case was relatively straight-forward. But even so, working with Redmans was easy, quick, professional & clear. Many thanks

Posted 2 months ago

Anonymous

The team were very helpful and answered all my questions regarding my redundancy. Initially I had a call with one of the representatives who escalated my request to a suitable employment solicitor. We arranged a call to discuss the settlement and she helped answer all my questions. We then mainly contacted through email which helped resolve the settlement quickly and convently. Thanks for all the help.

Posted 2 months ago

Djaouida T

You have good communication.

Posted 2 months ago

Anonymous

Fast and professional. A highly recommended company for employment related issues.

Posted 2 months ago

Anonymous

Very professional service.

Posted 2 months ago

Brittany

I was very grateful for Redmans to treat my case with respect and discretion. At the time, I was very new to London and it was meaningful to have someone on my side and win the case for me. Without any doubt, I would definitely recommend Redmans Solicitors to anyone who is in need of it.

Posted 10 months ago

Jake L

Chris is very professional and calm. Very attentive and patient, been a positive experience having Chris represent me, and would recommend him.

Posted 1 year ago